India Central Bank Seen Intervening to Weaken Rupee

Rupee Down 3% Since May Despite Especially Heavy Inflows

By

Anjani Trivedi

Updated Aug. 27, 2014 12:37 p.m. ET

Investors pouring billions of dollars into India's rallying stock and bond markets are encountering a surprise: a weak currency.

The rupee has slumped 3% since the business-friendly Bharatiya Janata Party took power in May, in sharp contrast to the nation's stocks, which have risen 9.6% to record highs and are up 25% for the year, ranking as Asia's best performers.